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Cannabis tourism is not a new concept, considering Amsterdam has been a mecca since the 1970’s. In the U.S., however, it’s a fledgling, yet rapidly budding industry. The convergence of two massive industries creates unique opportunities for entrepreneurs across both sectors -- if the legal, health, and safety risks are mitigated correctly.
For anyone looking to capitalize on this lucrative sector, having the right business liability insurance coverages is a must. S2S Insurance Specialists, an independent insurance broker serving the cannabis industry exclusively, is here to guide you on which policies you need to minimize your risks and protect your green.
States with well-established recreational programs, like California, Colorado and Nevada, were the trailblazers in cannabis tourism. As these markets matured, and product sales peaked…then slowed…operators sought out new revenue streams. Why not tap into their multi-million-dollar hospitality and tourism economies? After all, for weed lovers, visiting places where you can buy and consume cannabis legally is a big draw—especially for those living in states where marijuana remains illegal. According to a study by Grand View Research, Millennials are increasingly choosing destinations where cannabis is legal, with 50% considering it essential for vacation planning.[i]
Just as wine turned Napa Valley into a world-renowned destination, cannabis is transforming
communities across the country into tourist hotspots. Take Oakland, CA, for example. To help shake their crime-ridden image, the city launched an innovative cannabis tourism program, led by Visit Oakland, to attract visitors to its pot-friendly coffee shops, cannabis-friendly lodging, and “higher” education opportunities at Oaksterdam University. The Oakland Cannabis Trail has earned global acclaim, including recognition by Condé Nast Traveler and Food & Wine, and serves as a model for success.
As legalization continues to spread across the U.S., cannabis lovers have a growing number of places to put on their travel bucket list. Businesses catering to cannabis tourism not only attract weed-loving vacationers, but a broader audience of those seeking cultural and educational experiences. Innovation is fueling growth in the cannabis tourism market. From guided tours of cannabis farms, to wellness retreats, to pot pairing dining experiences and cannabis-themed festivals, there’s no shortage of diverse, 420-friendly experiences.
Today, cannabis tourism is an economic engine that is projected to generate $23.73B by 2030, with the U.S. dominating the global market and accounting for over 50 percent of the revenue share.[i] Planet 13, the world’s largest dispensary, doubles as a must-see attraction, drawing over a million visitors annually to its growing portfolio of locations.[ii] The bottom line: as new markets emerge and existing ones mature, the opportunities in this niche are expanding rapidly.
It’s not all roses and rainbows for those operating in cannabis tourism. As the industry grows, so does the outcry of public health concerns related to pot-intoxication, including over-indulgence, prescription drug interactions and adverse side effects. Businesses that cater to cannabis tourists need to ensure the safety of their guests and mitigate their risk exposure. Below is an overview of the insurances policies that protect businesses from devastating lawsuits and fines:
1) General Liability Insurance
A critical coverage your business needs to protect from a variety of claims including bodily injury, property damage, personal injury and other situations that may arise including slander, libel, copyright infringement and more.
Essential for all businesses, and especially dispensaries, tour operators, and cannabis-friendly lodgings. One injury from a slip-and-fall can result in a devastating lawsuit.
2) Product Liability Insurance
Protects businesses against claims arising from harmful cannabis products, including mis-dosage; defective products, recalls and false advertising claims.
Vital for dispensaries, infused dining experiences, and cannabis lounges.
3) Intoxication Liability Insurance
Written into Liquor Liability Coverage, this policy covers claims that may arise from the serving or over-serving of THC to patrons.
Essential for those in the food service and hospitality industry, product manufacturers, wholesale distributors and importers, short-term events, products and services that support other cannabis businesses and select contracting operations.
4) Commercial Property Insurance
Protects the business property, including dispensaries, lounges, event space, etc. from damage due to fire, theft, vandalism or natural disasters.
Some policies offer additional coverage for cannabis inventory, which may require specialized endorsements.
5) Professional Liability Insurance (Errors & Omissions)
Shields businesses from claims of negligence, misrepresentation, or failure to provide promised/marketed services.
Important for cannabis tour guides, wellness retreat organizers, and anyone providing curated experiences.
6). Cyber Defense Insurance
Protects businesses from data breaches, hacking, and cyberattacks.
Essential for dispensaries and any tourism business handling online transactions, reservations and customer data.
Cannabis tourism presents exciting opportunities for entrepreneurs and businesses, but it also introduces significant operational and liability risks. Companies latching themselves to these opportunities have the potential to reap many rewards – but only if they take the necessary precautions to minimizes their own liability. Having the right insurance policies in place is crucial to protecting businesses from liability and financial loss. It is also important to work with an insurance broker, like S2S Insurance Specialists, who have a deep understanding of the cannabis industry and access to all the top-rated policies available from insurance carriers. For a free consultation, click here or call (954) 790-6604.
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